Trading Psychology Hack: don´t look at your account results, and don´t set result targets.
Yes, this is counterintuitive and different from what you´re normally taught... but bear with me (no pun intended).
🧵 (here goes a thread...) 👇
#trading #tradingpsychology
Yes, this is counterintuitive and different from what you´re normally taught... but bear with me (no pun intended).
🧵 (here goes a thread...) 👇
#trading #tradingpsychology
As a trader, I found out that focusing only on following a set of winning strategies consistently, brings me the best results.
But usually we are taught that you must have daily/weekly targets for profits or losses, and stop when they are reached. IMHO, that´s lousy advice.
But usually we are taught that you must have daily/weekly targets for profits or losses, and stop when they are reached. IMHO, that´s lousy advice.
Upon finding some strategies that give me a consistent profit over time, I decided to simply stop looking ate results continuously. And I absolutely don´t have trading targets to be reached over time. Want to try this? Here are 2 DOs and 2 DON´Ts...
💚 DO 1:
Find your edge. Follow it consistently. The edge is the set of strategies that are profitable when you run it over and over. If the edge is well defined, there is no 2nd guessing, FUD/FOMO, or emotional reactions. Just follow your rules when the conditions are right.
Find your edge. Follow it consistently. The edge is the set of strategies that are profitable when you run it over and over. If the edge is well defined, there is no 2nd guessing, FUD/FOMO, or emotional reactions. Just follow your rules when the conditions are right.
💚 DO 2:
Monitor the effectiveness of your edge. Daily results are not important. They are only a consequence of a good strategy. If your winning edge is in place, there´s nothing else to worry about. If your strategy is a loser, correct it. This is the key focus you should have
Monitor the effectiveness of your edge. Daily results are not important. They are only a consequence of a good strategy. If your winning edge is in place, there´s nothing else to worry about. If your strategy is a loser, correct it. This is the key focus you should have
💔 DON´T 1:
Forget about setting trading targets. If you have, for example, a target of $200 per day and maximum loss of $100 per day, you mind will play tricks on you based on these artificial parameters. You may enter bad trades just to try to reach the target.
Forget about setting trading targets. If you have, for example, a target of $200 per day and maximum loss of $100 per day, you mind will play tricks on you based on these artificial parameters. You may enter bad trades just to try to reach the target.
You should only follow your edge, as often as possible. If you get 20 trades per day, great! if you get 0, it´s ok. Trading targets will only make you chase numbers and forget your rules.
💔 DON´T 2:
Stop looking at your results the whole time. I only look at results once, at the end of the day, for record keeping purposes. If you look at how much you´re winning or losing during the day, it will affect your psychology, and mistakes will be made.
Stop looking at your results the whole time. I only look at results once, at the end of the day, for record keeping purposes. If you look at how much you´re winning or losing during the day, it will affect your psychology, and mistakes will be made.
You may get scared, greedy, lose confidence, etc... and all of these are your edge´s kryptonite.
[end of thread]
What do you think about trying this out? Let me know in the comments below...
[end of thread]
What do you think about trying this out? Let me know in the comments below...
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